The U.S. Department of Justice (DOJ) has filed a lawsuit to block Hewlett Packard Enterprise’s (HPE) planned $14 billion acquisition of Juniper Networks Inc., citing concerns over reduced competition in the wireless networking market. The lawsuit was filed Thursday in the Northern District of California, with the DOJ arguing that the merger would combine the second- and third-largest players in the enterprise-grade wireless local area network (WLAN) sector.
A Battle Over Market Power
Acting Assistant Attorney General Omeed A. Assefi, who heads the DOJ’s Antitrust Division, explained that while both HPE and Juniper are successful companies, their merger would consolidate market power in an already concentrated industry. According to the DOJ, this deal would diminish competition and harm both innovation and consumers.
“As these two companies seek to merge, they would eliminate the competition necessary to keep innovation alive and prices fair,” Assefi said in a statement. “We cannot allow the merger of two major players to create a market that leaves consumers and businesses footing the bill for a less competitive environment.”
The Stakes Are High for American Industries
The DOJ further argued that key industries in the U.S., including hospitals and small businesses, rely heavily on wireless networks to function effectively. The proposed merger, Assefi warned, could result in higher costs and less innovation, weakening the wireless technology sector, which is vital to the U.S. economy.
